One of the nagging unknowns concerning many of the electric truck startup companies breaking into trucking is how they will handle large-scale production once demand for their vehicles ramps up.

Now, Nikola Motor Company has dislcosed how it will produce its forthcoming Tre model in Europe. On February 6, Italy-based CNH Industrial's Iveco and FPT business units together with Nikola announced future Nikola Tre production will take place at an Iveco plant in Ulm, Germany.

The companies said the strategic and exclusive heavy-duty truck partnership will have CNH Industrial taking a $250 million stake in Nikola as lead Series D investor. The Nikola Tre, a battery-electric heavy-duty truck is described as the first step towards the comapny producing a fuel-cell electric truck model.

Today, the site in Ulm serves as Iveco’s chassis engineering hub. Nikola said the facility is “ideally” situated at the heart of the Baden-Württemberg region, which is striving to become a leading hub for fuel-cell mobility thanks  to its skilled workforce and research labs.

Additionally, Iveco noted that local governments and business groups in the area have committed a substantial investment to fund research and development projects in the area. Another strong point, Nikloa said, is the strong automotive industry presence there, with strategic project partnerships in the area that gives the Ulm facility close proximity to key suppliers.

Furthermore, Nikola noted in a press release on the joint venture, the German Federal Government recently released its draft National Hydrogen Strategy, which aims to expand the pioneering role of companies engaged in hydrogen technologies. This strategy commits a total of €2 billion ( $2.2 billlion) to fund the hydrogen innovation program, including the development of the necessary distribution infrastructure. 

“Our European joint venture with Nikola and today’s announcement, is real proof that zero-emission long-haul transport is becoming a reality, resulting in tangible environmental benefits for Europe’s long distance fleets and its citizens,” said Hubertus Mühlhäuser, CEO of CNH Industrial. “The decision to build the Nikola Tre in Ulm – a center of heavy-duty truck engineering excellence – underscores the site’s strategic location at the heart of Germany’s fuel cell technology cluster.”

In the first stage of the project, €40 million ($4.4 million) will be invested by the joint-venture company to upgrade the manufacturing facility, which will focus on final assembly of the vehicle. Start of production is slated for the first quarter of 2021, with deliveries of the Nikola Tre beginning that year.

“The Nikola Tre is proving to be the most advanced articulated truck in the world and will continue to set the standard for zero-emission vehicles today and in the future,” said Trevor Milton, Nikola CEO.  “The decision to volume produce the Tre in the city of Ulm is a fitting example of how to create jobs, foster innovation, provide certainty to new zero-emission part suppliers and serve as an example to other OEMs. The world is ready for zero-emission freight transportation, and the joint venture between Nikola and Iveco will be the first to deliver."

The first models to enter production will be battery-electric 4x2 and 6x2 articulated trucks with modular and scalable batteries with a capacity of up to 720 kWh and an electric powertrain that delivers up to 480 kW of continuous power output, Milton said.

The Ulm facility will receive module supplies from Iveco’s manufacturing locations in Valladolid and Madrid, Spain, which will enable a rapid ramp-up to meet expected customer demand. Fuel-cell electric versions, built on the same platform, will be tested under the EU-funded H2Haul project during 2021 for an expected market launch in 2023.

The Nikola Tre currently in development is based on the new Iveco S-Way platform and integrates Nikola’s truck technology, controls and infotainment systems. Testing is expected to begin in mid-2020 with prototypes showcased at the IAA 2020 commercial vehicle exhibition in Hannover, Germany, this September.

“By drawing on our Gold standard World Class Manufacturing sites in Madrid and Valladolid, Spain, where the Iveco S-Way is produced, we are able to accelerate final assembly, powertrain integration and high-end customization of the Nikola Tre for a timely market introduction in 2021,” said Gerrit Marx, president of Commercial and Speciality Vehicles for CNH Industrial.

Nikola noted the production joint venture forms part of a wider partnership established to accelerate industry transformation towards the "emission neutrality" of Class 8 heavy-duty trucks in North America and Europe by adopting  fuel-cell technology. The primary focus of the collaboration is to leverage each partners’ respective expertise to successfully deploy zero-emission heavy-duty trucks and to disrupt the industry with an entirely new business model, the company added.